"Ben, I want to say one word to you--just one word:
plastics." Thirty years after that succinct career advice was
pressed on Benjamin in "The Graduate," another kind of
plastic--credit cards--is launching thousands of businesses each
year.

About 70 percent of small businesses are funded by credit cards
and personal savings, according to NEBS, a Groton, Massachusetts,
provider of business and computer forms.

"Credit card start-ups don't necessarily remain small
businesses for long," says Kelly Presta, spokesperson for
Visa. Be warned, however, that credit card financing can carry
sizable transaction fees and higher interest rates from the day the
funds are accessed.

Craig Ford--who, lured by opportunity, left his job in 1992--has
a different view. In 1993, he and a partner invested in a medical
billing business that promised healthy profits but delivered sickly
losses. The Los Angeles entrepreneurs reached for the plastic,
amassing debts of $40,000 on about 10 Visa cards and
MasterCards.

"Today, Billex is thriving," Ford reports, "but
we're still saddled with thousands of dollars in high-interest
credit card debt. For us, it means reduced earnings--but for a
business with only marginal profits, it could mean
failure."

Others are taking advantage of banks that offer low teaser rates
to entice new applicants. Instead of short-term loans, resourceful
entrepreneurs are taking cash advances at rates as low as 4.9
percent. But the teaser rates usually last for only six to 12
months. Be sure you can repay the balance before the
interest rate skyrockets to as much as 21 percent, or be prepared
to transfer the balance to another low-interest card.

Paul DeCeglie is a former staff reporter for Journal of
Commerce and American Banker. He can be reached at
MrWritePDC@aol.com

Easy Does It

You don't have to be a programmer to operate a computer, and
you needn't be an accountant to keep good financial
records--not with the Big E-Z Bookkeeping System (Big E-Z
Bookkeeping Co., $45, 800-650-3279). Designed for numbers-shy
business owners, the handbook provides a few pages of simple
instructions and requires you to fill out only four clearly labeled
forms. The 100-page book includes three optional forms (which the
skittish may ignore), examples of completed forms and an envelope
for receipts.

"It's an effortless tool that will keep your business
on track for an entire year," promises Michelle Carley,
president of Big E-Z Bookkeeping Co., and a former corporate
controller and veteran bookkeeper. Her tips:

1. Keep daily records and monitor them to detect and
correct problems immediately.

3. To save time reconciling, open a business checking
account with month-end cutoff dates for statements.

The Loan Arranger

Who says you can't get low-cost start-up capital without
collateral? B&O Funding Sources Inc. has arranged for banks and
other lenders to provide entrepreneurs unsecured, simple-interest
loans with no pre-payment penalties. Unsecured loan amounts range
from $3,000 to $25,000.

There's one catch: funds are available only to affiliates of
40 B&O clients--franchisors, distributors and vending-machine
business opportunities. "They're expansion-oriented
companies seeking affiliates across the country," says B&O
CEO Guy L. James, who founded the Boca Raton, Florida, firm last
January. "We check out each company carefully before accepting
them as clients, then we source start-up capital for their
affiliates."

The process gives entrepreneurs easy access to funds based
solely on their creditworthiness. Unsecured loans, with interest
rates of 12 percent to 16 percent for up to 45 months, may be used
to pay for equipment, machinery, merchandise, supplies and
shipping. For a list of B&O clients, call
(561) 347-9150.